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Stop Treading Water: Planning to Save Money

Wishes and dreams are great to have, but when it comes to your money and financial life, you need something a little more concrete. This is especially true when you are talking about saving money. Saving is something that works best when you have it down to an easy, repeatable process that can be tracked and measured.

However, you may not be in a place where you can aggressively pursue your savings goals yet. Maybe you’re just out of college and are in the hunt for a job, are in between jobs, or have a budget that allows you to hit the essentials but not much else. Creating a plan for your savings is great because it costs you nothing, but gives you a roadmap for how to be smart with your money.

Step One: Get to Know Yourself a Little Better

Do you actually like your job/industry/career or are only there because you needed money? Where do you want to be in five, ten or fifteen years? What type of things are you passionate about?

Answering questions like these can shed a lot of light on both life and financial goals. As Michael Barry wrote in an article entitled The Future is Now: Thinking About Thinking About Saving Money, “Whatever future you envision for yourself, the first step is envisioning it.”

Step Two: Create Your Plan

All the takeout meals, the newest iPhone and fancy wardrobe won’t be there for you when you need them in retirement. That’s why having the right budget to limit those types of spending is a definite “must.”

However, in setting up your budget, remember that you have a life to live. As Barry points out in his article, “It’s very easy to say ‘I’ll put away thirty percent of my check for this and an extra hundred dollars for that’. But if you have rent to pay and a pretty girl to take out, those are parts of your life that shouldn’t be glossed over. That isn’t to say that there aren’t ways to save there too, but they shouldn’t be factored out of your plan altogether.”

Step Three: Re-Tool Your Budget as You Go

Your budget is a living and breathing thing that should change as your income and financial needs change (hopefully for the better). Don’t be afraid to tinker with your budget as your finances progress.

Step Four: Give Yourself Something to Shoot For

Create a mix of short and long-term goals that give you the ability to track your progress. It’s a lot easier to hit something when you have a target to aim at.

Whether you have the means to save aggressively right now or can only put your plan on paper, the right plan gives you a road map to follow to financial success. You can always come to Lincoln Savings Bank for help, so don’t hesitate to call or come by!